“Two months ago, I spoke about low growth and high debt. Yet, I also emphasised resilience—how nations continue to survive large shocks due to strong fundamentals and adaptive policies. Today, this resilience is again under pressure, especially with the changing global trade system.”

Nazir Jinnah speaking in London’s financial market trade conference on March 21 2025.

Financial market volatility is on the rise. Trade policy uncertainty is at unprecedented levels. Global stock prices have dropped due to trade tensions, even as many valuations remain high. This is a stark reminder of how quickly things can change, a world where sudden and sweeping shifts are becoming the norm. And in these moments of volatility, the imperative to respond wisely has never been clearer. A more balanced, resilient world economy is within reach if we act decisively.

What is the context? Trade tensions have long been brewing, but now they’re boiling over. The erosion of trust—both in the international system and between countries—is evident. Global economic integration has lifted many from poverty, but it hasn’t benefitted everyone. Communities left behind by jobs moved overseas, stagnant wages, and disrupted supply chains have given rise to negative perceptions of a system that feels unfair.

These tensions are evident in rising tariffs and non-tariff barriers, and the complexity of this environment is making it harder for smaller economies to thrive. National security concerns have become paramount, with industries and resources considered too critical to outsource, fueling a resurgence in self-reliance and protectionism.

Now, we are faced with significant consequences. Increased tariffs have elevated costs, not just for countries imposing them, but for global markets. The complexity of global supply chains means the effects ripple across economies, leading to uncertainty, delayed investments, and volatile financial markets. The cost of uncertainty is high; it disrupts planning, increases prices, and hampers growth.

In the long run, protectionism erodes productivity. While shielding domestic industries from competition may seem like an immediate solution, it reduces incentives for innovation and efficient resource allocation. Ultimately, we need to balance global openness with targeted protection that preserves competitiveness.

As nations grapple with these challenges, what can be done? Countries must double down on strengthening their economies. In this era of heightened uncertainty, there is no room for complacency. Reforms aimed at enhancing stability and growth potential are essential. Fiscal responsibility and structural reforms are needed, especially in emerging markets and low-income nations. And for nations burdened by public debt, proactive efforts toward sustainability are critical, including possible debt restructuring.

Policymakers must prioritize fiscal, monetary, and structural policies that can bring balance, especially in an interconnected world. Efforts to address internal imbalances in saving and investment must also be coupled with strategies for rebalancing external accounts. Global cooperation must replace division, with a focus on reducing trade barriers and fostering a fairer, more resilient international economy.

At Aspire Development Foundation Network (ADFN), we believe that in the face of adversity lies the opportunity for transformative change. While challenges may seem insurmountable, with strategic action, cooler heads, and clear vision, we can overcome barriers and rebuild. The world is in transition, and in this moment, we must look beyond preserving the old and focus on creating the new—a more resilient and balanced global economy.

Let us seize this moment, together.